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Domestic debt soars to Rs39.87tn in July’21

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September 6, 2021 (MLN): The total debt of the Central Government during the first month of FY22 surged by Rs4.3trillion or around 12% YoY to stand at Rs39.87tr when compared to Rs35.5tr recorded in Jul FY21.

By the end of FY21, federal government debt stood at Rs38.7tr, showing that on monthly basis, the debt increased by Rs1.2tr or 3% MoM during July'21 which is the highest monthly increase since Jun’19.

The data released by the State Bank of Pakistan (SBP) shows that the larger portion of the debt was domestic, whereas the remaining was external. The Central Government Domestic Debt amounted to Rs26.82tr during Jul FY22, signifying a growth of around 15% YoY, comprising of Rs19.056tr long term debt and Rs7.74tr short term debt.

By the end of Jul’21, the government’s long-term debt escalated by approximately 5% when compared to Rs18tr at the end of Jul FY21. It is mainly due to the government’s decision to increase the maturity period of debt through converting its short-term borrowing from the central bank to long-term debt.

Meanwhile, the short-term debt surged by 45% YoY.

Within the long-term domestic debt, the Pakistan Investment Bonds (PIBs) accounted for Rs14.1tr, up by 7% YoY and Saving Schemes accounted for Rs3.64tr, down by 1% YoY.

While in the short-term domestic debt, Market Treasury Bills (MTBs) amounted to Rs7.74tr, showing a growth of 45% YoY in July FY22.

A breakup of the Central Government External Debt shows that nearly Rs12.87tr came from long-term loans while Rs172billion came from short-term loans.

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Posted on: 2021-09-06T18:19:00+05:00

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